Posted on: November 01, 2021
WI 809 | Wholesale Fees

 

If you’ve been putting off starting a wholesaling business because you don’t feel ‘qualified,’ don’t have your personal finances in order, or just don’t know where to start…then this episode is a must-listen! This will be an excellent starting point for your real estate career.

Dive in as Lauren Hardy interviews Ryan Zwerneman, one of her students in her wholesaling coaching program, covering his journey in wholesaling and how he’s been running the business as a side hustle. He also shares his experiences, his biggest hurdle in getting started, and what it took for him to ignite his wholesaling business, jumping from having zero contracts to closing a whopping $160k in wholesale fees with another ten deals in the pipeline – with the help of Lauren’s tweaks and tricks.

$160k in Wholesale Fees with Another 10 Deals in the Pipeline

I have got one of my awesome students in my coaching program. His name is Ryan Zwerneman. Ryan is one of my faves. We hit it off. I met Ryan early on because if you are a part of my coaching program, I do have little office hangouts from time to time. I met Ryan in person, and I instantly knew he had what it took. He had a very strong work ethic. He needed to fix his machine a little bit, some training, and alter some things.

Those alterations that we discussed in that one-hour luncheon were the difference between Ryan having zero contracts in the pipeline and the guy being full. His pipeline is crazy. He’s crushing it now. It shows how one hour of your time spent over lunch getting advice from someone can change your career and the way your year is looking. We were going to talk about all that in this episode, but first, I want to introduce Ryan. Ryan, welcome to the show.

Thanks for having me, Lauren.

Thank you for coming because you have a super inspirational story and I’m looking forward to you sharing it with us. Let’s first start out with why did you decide to get into wholesaling houses?

I started in 2019 as a side hustle. I went through about two years of not awesomeness. I was in a corporate gig and it had some good things about it and some things that I have probably wanted to figure out how to do something different with my life. That is why I got into it. Not that I hated my job because I love the people, but I think I didn’t see where I was going.

You started in 2019 and you said it wasn’t so great. Why is that?

The first year was one bad partnership. I tried to also virtually in Houston while I was living in California. It was like the blind leading the blind and I hooked up with a couple of guys. I was looking to buy experience basically and put all the capital in, and it didn’t go great. We did get one deal but we split it three ways and I had put all the capital in, so I didn’t even get made whole and I had to put more money in to keep going. I was like, “I’m done.”

I want to stop on this thing. What led you to partner up with these guys? Did you think they knew what they were doing?

Yes and I was virtual, so I was like, “I need people in.”

It’s not right to make decisions for other people.

Did they have experience? Did they say they have experience?

This is when people interview for a job. They are going to put their best foot forward and maybe fudge the numbers a little. I think they were great people. I don’t think we were super transparent with people upfront.

Do you know why I’m asking? It’s because we were in this world of everyone being an influencer. I’m personally noticing more people come out of the woodworks talking about coaching, “I’m going to coach real estate and wholesaling,” but you can see that they started a year ago. I’m going like, “You are very new and you are saying that you’re a coach, and they are taking on coaching clients.” I’m going, “I have been doing this for years and I didn’t think I could be a coach.” When I got approached, I was like, “I don’t know. Could I be a coach?”

I don’t even think I should be on a show.

Yes, imposter syndrome. We were going like, “Should I even be a coach? Am I worthy of that? Do I have the experience?” I’m seeing on Instagram that everybody is an influencer now. There are a lot of people now getting people to believe that they have more experience than they do.

It’s like reverse imposter syndrome or something like that.

These people are like reverse imposter syndrome where they don’t have what we have. Instead, they have the opposite where they were like, “I could teach other people how to do this.” Interestingly, your first partnership probably acted like they had more experience than they did. I love that you said the blind leading the blind because I use that. You know I use that analogy all the time. When you get the wrong JV partner, it is crazy. It’s easy to do that because some people have monster confidence in themselves.

In this day and age of social media, you are seeing it everywhere and it is easy to fall for it. I wanted to pause because a lot of people are in that exact situation that you were now. Don’t feel bad because a lot of people fall into this. You went from that and you were like, “This isn’t making sense.” You don’t know what you’re doing. You had to stick with it for a while to realize they didn’t know what they were doing because you were not making money. What did you do? From that partnership, where’d you go?

I got together with a couple of guys. One of them was a guy that had done deals. I was like, “I need somebody that does have experience.” I hedged my car to somebody who brought somebody else along. We got into another partnership and then started virtually wholesaling in Memphis. The way we picked that market like you would have beat me up as a student. It was basically price point landlord-friendly. That was it. I didn’t know anything about Memphis, though. I didn’t do much research. They had other side businesses and it was one of those things where I’m doing a lot of the day-to-day foot traffic work and asking for help.

WI 809 | Wholesale Fees

Wholesale Fees: You need to pay people that know what they’re doing and have a process and system in place to figure out how to be successful.

 

Getting an answer every week doesn’t mean that you are going to be successful there. In the beginning, I did what a lot of people do. I tried to get the experience from their people instead of either paying for coaching or taking my lumps. It took me two years of bad partnerships to realize I don’t need other people until I hire and I need to pay people who know what they are doing that have a process and a system to figure out how to be successful.

I got to say you were on the right track because I do think that losing your ego and being willing to partner is a great thing. Unfortunately, when you don’t know much about the business, you don’t know if your partner knows what they were doing.

There is a difference between humility and ignorance for being naive.

I will share a personal story with me. I did similar things when I first got started. When I first got started, it was a beautiful time to be a house flipper. Anybody could be a house flipper. It was so easy to buy a house in Southern California, where we are from, 50% off. I didn’t know the opportunity that was right in front of my face because my first mentor wasn’t that experienced yet either. He was maybe 3 or 4 deals before I was.

He didn’t have a ton of house will be experienced enough to teach me the nuts and bolts. I’m super thankful, but not these guys that are at the courthouse steps buying a house a day and they were flipping in California 50 or 100 houses a year. In my first couple of years, I was doing a similar thing. I was following what someone else did. I was very low volume. If I had partnered up with someone that was high volume, I would be a lot further along now. I didn’t get into coaching programs like paid coaching for my first couple of years.

The same timeframe, right?

Yes. I did get some free coaching programs. Someone gave me a couple of them. I did have the actual lessons and that is how I learned as I learned through the lessons. They used to come in binders with CDs. I listened to all these CDs and had a mentor who had flipped maybe 3, 4, maybe 5 houses before they taught me how to do it. What happened was great. I learned how to flip house. I did do some deals, but I could have done way more. My career might be even different than what it looks like now if I would’ve done that. We all made that mistake and I wanted to share that I did something similar. You had a couple of failed partnerships. What happened in your life after that?

People go through waves. We are self-employed and we decide to pick ourselves back up if we’re going to do it. COVID happened and basically, I’m spending way more time at home because I was in a corporate job where I used to travel 40 out of 52 weeks a year on the road. I was thinking about things opening back up and I’m like, “I can’t do that again.” I had more time to do things on the side and I started this company in October of 2020. I made it to May 2021 and the company that I was working for. There’s a bunch of going on and things like that, so my position got downsized.

I was like, “I could either go get a new job in automotive,” which I did want to do anymore or I could make a real go with this. That is what I decided to do. I had closed a deal in March 2021 after a ton of marketing since October 2021. I took that money and threw it into coaching, marketing, and that stuff. We started in June. After I got laid off, I started with you and put the work in.

Stay laser-focused on what you need to do today.

I remember our first call when you joined the coaching program. I always get a little nervous when I hear someone say like, “I was laid off from my job. This is all I have got,” because you were very like, “This is it. I’ve got to make this work and you need to make this work for me.” That is what I hear. I hear in my head, “Lauren, you better make this work for me. The pressure is on. We were like, “Help me out.” I better give this guy everything I know and stay on top of him. You joined the coaching program. What were some of the things initially that you learned by joining coaching and getting some actual processes? What were some of the things you were doing wrong in those two years? Is there anything maybe your top three things that you can think of?

It is so hard because I have had many learning moments. In the beginning, what struck me was when you and I sat down in person. I knew that I needed some fine-tuning on how to do things virtually and better processes for working with people in an area and things of that nature. The thing for me was we sat down and in my corporate job, I was a sales closer or director. I had a whole West side of the US. The difference was somebody else would do all the work and I would walk in and lock it down if I could.

You and I sat down and you’re like, “How many offers have you made?” All those types of things. The different KPIs that you should certainly focus on. I quickly realized I was not doing enough. I’m pre-disqualifying people because I was used to getting better leads on my original job. I’m also not putting in enough effort of talking to enough people versus trying to get to all the good leads, the laydowns.

You were taking the laydowns. What he is talking about is there is a couple of things. Ryan has extensive sales experience. That was his background. It was sales, but he had different training. When I’m hiring an acquisition manager for my team, I do not want anyone who has previous real estate experience. They are hard to train and usually receive bad training or different types of training, especially if they come from another real estate investment company. That tells me that they didn’t work out in that company and then they are coming to me. In general, they are different training and it gets hard for salespeople. Anybody who’s had an experience with something, it’s hard to do it a different way.

It’s hard but what was great about you is you are very coachable and you changed it up immediately. Sometimes, people aren’t as coachable. When I asked Ryan, I knew real quick. I call it running diagnostics and I could figure out quickly what you’re doing in your sales funnel management that this is the problem. I asked Ryan, “Tell me about your lead generation. You were doing texting. How many texts did you send? How many leads did you get out of that?” I was asking these numbers, then I was like, “How many offers did you make?” He told me a number, then I was like, “All right. How many contracts have you gotten?” Nothing.

I can tell because I know the ratios between how many texts you should send to get a lead to make an offer and where he was broken was his offers. He was getting a bunch of leads, but then he only made an offer to like 10% of over something because he was looking for the ones that were immediately saying that their mom died and they lost their job. He was looking for the laydowns like the very distressed leads.

As a prior military guy, I have a lot of integrity. My biggest thing was I didn’t want to offend people that probably wouldn’t go with me. I was making their decisions, which was not the right thing to do.

You never know. Sellers have different personalities. Some of them, I call them the poker face sellers. They’re going to act like they’d be offended, but they will consider your offer, but they maybe need some time and some follow-up. You have to make an offer. You don’t know. I explain this to my team because every acquisition manager I’ve ever hired does what you do at first. Every single one does what you do. In fact, a lot of my coaching students do it as well. I explain it like this. For every ten leads you get, you might get 2 to 3 that meet that motivation. They sound motivated. They’re nice and friendly. You could think that they would be receptive. Maybe two will be like that.

That’s 20%. You’ve got eight other leads that are not going to sound very motivated at all. Out of 8 of them, maybe 7 of them aren’t that motivated. They would be better realtor referrals or something or there were total tire kickers, not interested in selling it all, but there is that one out of that. Out of ten, there’s that one that was poker facing you. You won’t know until you talk to all of them and give them all a number or an offer. Take that with you.

WI 809 | Wholesale Fees

Wholesale Fees: A bad partnership is like the blind leading the blind.

 

With every episode that I do, I always try to give practical advice. It’s something that you can take with you. Please take that one. Write that down. This is very important. Give offers to everybody. That was a big game-changer for you. I remember that day and you promised me, you’re like, “I promise I’m going to have ten offers by next week when we check-in.”

I showed up for the coaching call and I put them into the chat like, “Here’s what I did,” because accountability is a big thing for me.

You are good about that. You’re so coachable and I love that. You came back and were like, “I did it,” then things changed quickly for you.

From doing that, I got a deal that closed in August 2021. One, I was living in California, where it was super expensive, so I thought, “I’m going to take a chance to go as all in as possible.” What I did was I sold off everything, gave it away or stored it. I bought an RV and moved to my market. Now, I live in my market because I feel like I’m a relationship salesperson anyways but also want to build something because now I’m sitting in an office. I did way more marketing and figured out different types of things. I’m a pretty nerdy dude when it comes to that. What I did was, I think we had four in September 2021 that closed and now we have ten on the board for October and November 2021. We’ve already closed a couple in October and trying to hire and get big.

You went from nothing to now. You’ve got four in September. How many in October 2021? I have lost track of you already. You got on the board and your pipeline.

Six on October 2021. I also started working with Chris and doing referrals. That is how I pay myself now and the rest of the money goes down. I only pay myself off referrals.

He is using Chris Craddock’s REI Revive Program and he is also monetizing his leads that were the tire kickers and referring them to the realtor. You guys should check out REI Revive at WholesalingInc.com, Chris Craddocks’ program. It’s amazing. Your explosive growth is massive. How many deals have you closed since joining me? You’re getting it together.

It’s probably twelve.

Do you know on top of your head the total growth?

Continue to do consistent action.

I’m making $166,000. I’m making more or it’s basically what I would get paid in my job. We have $50,000 for the end of the year yet.

At around $160,000-plus, you replaced your full-time income.

It’s not my money. It’s the way that I like to look at it, which is why if I live fairly cheaply, I can grow it and bring other people into the organization. One day, that is way easier than worrying about, like, “How do I live the same lifestyle I did?”

You have done very well. Ryan, you are very smart and sharp. You had sales experience. You had everything that someone who doesn’t have those types of skills would say, “Of course, he’s going to crush it,” but you were not crushing it before you had good direction.

That’s true.

Doesn’t that show it’s getting good advice?

Yes. Since then, you and some other people, I owe it to those kinds of folks. I continued to try and get into other situations like a mastermind now where it’s people so I can learn how to keep stuff and those kinds of things. The different aspects of the business are that if you’re not always growing but still stay focused on what you need now, you’re not going to know what to do tomorrow. I’m going to get stuck in a run again. I’m trying to figure out how to do my job well, hire and train somebody to do that job, then fire myself and move into a new role. I’m trying to get to where you are. Either you’re helping people get better or you do not have to show up and make the offers every day. I want to get back to that when I get this.

That was the first thing that I outsourced was talking to sellers. I got into being an entrepreneur because I wanted time freedom but what you find at first, when you’re starting a business, is that you created a job for yourself. There is this crucial step of having to go from being the technician where you’re doing the technical work. You’ve created a job for yourself because you have to show up. You’ve got to do the work. Removing yourself from the technician and being the entrepreneur, you’ve got a technician under you. That’s a crucial step, but you have to be the technician for a while because you can’t hire anyone if you’ve never done it before. You don’t know how to train them and the stuff they can pull on to pretend they were working. That takes experience.

It’s going back to those first two years. I can’t tell people how to get better because I haven’t done it. You work with somebody who knows how to do it and you learn how to do it then you teach other people. That’s the growth. I think everybody says, “I don’t want to spend money on coaching. I want to put it into something.” It’s a backward way of thinking. If I could go back, I would have put money into coaching first.

I put money into coaching every year. I have a coach. I’m now more into the actual business entrepreneur coach than the actual real estate coach at this point. I’m learning so much from paying towards coaching with business coaches and stuff. Everybody needs a coach. You always need to be investing in your education. I think as long as I’m an entrepreneur, I’m going to be investing in coaching and education for myself. It’s the most powerful thing you can do for yourself. I’m very proud of you, Ryan. Your story is very inspirational. Thank you for sharing it. Is there any way people can get ahold of you if they have any questions? What’s your Instagram handle if you want to share it?

WI 809 | Wholesale Fees

Wholesale Fees: You can’t tell people how to get better if you haven’t done it.

 

It’s @ZwernoTheInferno. It’s an old sales joke. Some people thought it was because I wear my heart on my sleeve and when things don’t go right. It became a different joke. When I go on runs of selling a bunch of stuff, they would say it’s Zwerno is on fire. People can hit me up and DM and stuff. I do get asked, and I’m sure you get it all the time, like, “Can you help me?” It’s like, “I can point you in the right direction, then come talk to me.”

I get that a lot, too. Ryan, thank you so much for coming to the show. I want to leave off with maybe asking one more question. What is your best advice for somebody getting started with their mindset? What is something they need to tell themselves in their head to keep them focused on going? Is there something that helped you that you would tell yourself in your head?

I think the thing is we’re all people and you are allowed to have bad days, but that doesn’t mean that you can’t continue to do consistent action because if you have a bad day and you phoned it in and it’s going to keep going. I always used to use this one, but I heard it a long time ago in the military. It was eat the frog thing. If you had to eat one big, disgusting, hairy frog every day, when would you eat it? Is it for breakfast, lunch or dinner? The real thing is you have to get it out of the way. If it’s making offers, do it as early as possible. You have to do it because if you don’t eat your frog now, you have two frogs tomorrow and three the next day and they pile up to where you’re like, “Somebody else has to these frogs.”

I’m going to remember that. I’ve never heard of that saying before, but I wasn’t in the military. That is a good one.

It falls on consistency. That’s it. Go and do it. Take action and do it every day.

One tip on consistency. I learned this. Whenever you need to do something, some type of action requires willpower because it’s not something fun for you to do, so you’ve got to use some of your willpower storage, do it when you have the most energy. Most people, that’s right in the morning. That’s why I never work out at night. Forget it. If I start a 5:00 PM workout regimen, it’s not going to happen, but I work out at 6:00 in the morning. If it’s making offers, talking to sellers, try to get it done in the morning so that way you will have willpower reserve.

The people we talk to are not after 5:00 people, most of them. There are a few but most of them they are selling to us. It’s like they’re at home and ready to talk to you at 10:00 in the morning.

I love that advice. Thank you so much, Ryan, for coming to the show. If you are reading this and inspired to go virtual, I want to help you. I want you to check out the page, www.VirtualInvestingMastery.com. Fill out an application and somebody from my team will get back to you. You can join me and Ryan and the rest of the group. We’ve got a good group. There is a lot of love and success in it, and all we do is virtual wholesale in it. Make sure to check it out. Thank you so much for reading. I will see you next time.

 

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About Lauren Hardy

Lauren Hardy is a Virtual Investing expert and Real Estate influencer who owns multiple companies in the real estate industry including real estate investment, coaching, and software companies. She is also a Wholesaling Inc coach and co-host of the Wholesaling Inc Podcast.

Her experience in the last decade has been focused on real estate investing and creating products and services to serve the real estate investing community. If you are interested in investing in real estate virtually, house flipping, or virtual landlording, Lauren’s your girl.

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